Isaksen Johnson posted an update 1 month, 3 weeks ago
The telecom agencies usually have followed an improvement trajectory during the past decade through increase in client base and also adding considerable numbers for their annual revenue. They’ve got kept the pace with all the competitors and have unquestionably game with amazing success in the past. But in the present times, they may be facing with the enormous challenge of adaptation for the matured, highly penetrated markets coupled with global recessionary effect. Therefore, a change in paradigm to evolve their business models to the present situation is highly required as well as the demand for the hour is the customer experience management to accomplish an increased retention ratio.
Challenge in modern telecom industry – Customer retention
In the modern day telecom industry that has attained high penetration level, having a customer is getting even costlier. Industry analysis claims that only 25% with the acquired customers stick with the organization after an year’s some time to with an average only 20 -30% from the entire subscriber base is revenue earning/profitable customers. This dugs an in-depth hole from the balance sheet from the telecom providers. Due to the churning aftereffect of absolutely free themes, there exists a huge imbalance created in gross additions in the customers and net addition.
Forward path: Approach to customer retention – Customer experience management
Therefore, the most important challenge for your telecom operators around the world is managing customer churn. It affects profitability with the company in case a customer churns ahead of the company can earn back the investment it incurred in acquiring the consumer. Therefore, it’s very essential to indentify the profitable customers and retain them.
Retaining the profitable customers includes 2 steps:
1. Identifying the revenue earning customers in the entire subscriber base
2. Handling the customer experience and customer value for your revenue earning customers
Identifying the Revenue earning customers
The telecom service providers should define their business logic for identification of the revenue earning customers, for example: the shoppers with usage a lot more than ARPU are high valued customers, or perhaps the event of pre-paid, customers recharging greater than INR 250 each month (In Indian scenario) are viewed as revenue earning. With regards to the business rules your entire usage must be segmented into revenue earning customers and non-revenue earning customers. Managing customer ARPU Average revenue per customer. Managing customer data in scale of 40 – 50 millions is a challenge. Accomplished with the help of various business analysis tools (eg: SAS, SPSS, Teradata, etc.).
Customer experience management
Following the identification from the valued/revenue earning customers, managing those identified band of industry is very important.
Emphasizing customers as opposed to products
Within the last years, the telecom companies have concentrated on introduction of latest products. They’ve originated new products/services then sought to locate or build a marketplace for them. But increased competition among the existing companies and lower barrier to entry for brand spanking new players has ended in the increase in predatory activities inside the telecom industry. Moreover, the cost of acquisition of clients has grown considerably. Hence, in the current times, there exists a gradual change in focus from introduction of latest products for acquiring new clients to customers’ experience management is observed. Currently, the Telco’s need to pay attention to retaining the existing valued customers and targeting more wallet share of each customer by creating more value and improved customer experience.
By way of example: In UK, O2 has aligned its functional silos to get its existing customer’s perspective to create product decisions and designing promotional offerings. They’ve centered on retention by placing equal weight for renewals and acquisitions. With this the company has reduced its churn figure to half of its existing number.
Nintendo has built a web based community for capturing customer insights and offers incentives in exchange of customer information. From this Nintendo has gained valuable insights into market needs and preferences.
Customer led customization model
There’s an underlying assumption the agencies will dictate the future of telecommunication products and services. But the growing bargaining power the shoppers, there exists a shift in paradigm and the agencies should customize their model according to individual customer preferences. Now the business will follow charge from the customers in designing and promoting services designed to meet specific needs from the customers. Under this circumstance, the service providers have to know the unique needs of the person customers, and after that attempt to develop services which satisfy those multifaceted needs.
Using this model, the mass marketing will give strategy to the customized researching the market as well as the survival of the agencies is determined by the company’s ability to meet customer’s demand while on an ongoing basis. In other words, customers will dictate the terms of service they intend to receive.
Developing multiple channels
The service providers have to develop multiple channels for sales and support to further improve the client experience. Improving the footprint by adding on retail stores is one of the options that this telecom providers have practiced since ages. Traditional channels like telemarketer firms also was in focus. With the surge in competition and economic slowdown, the operators are looking for economical solutions to serve the clientele whilst keeping the service quality intact. Eventually the providers wish to move most its sales and services online with the web to realize better economics. Aside from attaining a cost effective solution by relocating to web channels, the operators can empower the customers can use to do various activities in a much cheaper price than the retail channels.
Online channels, a client are able to do numerous activities such as:
– Bill viewing and online payment
– Online register of a complaint for support
– Altering price plan and subscriptions
– Viewing the product or service catalogue and buy products/services online
Beyond the previously referred to activities, the operators will offer promotional services and cross-sell other products on the internet. The operators may have added revenue by ticker management on his or her websites and advertisements.
To provide the customers a frequent and connected experience, the operators must integrate every one of the existing channels. Each time a customer walks-in to a retail outlet, the buyer service representative should be able to retrieve his/her past interactions over-all the channels to provide him/her within the most beneficial way.
The operator needs to analyze/monitor how a customers begin using these channels. With respect to the available data of customers’ use of these channels, the operators can know the preferences of the person customers and mould their offering accordingly. From this the operators can build up customer experience by empowering these phones perform activities and therefore enhancing the service value for many years.
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